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Thursday, January 18, 2018

Oetker Sells Hamburg Süd to Maersk

Maritime Activity Reports, Inc.

December 1, 2016

Photo: Hamburg Süd

Photo: Hamburg Süd

 Dr. August Oetker KG announces that, after more than 80 years, it is divesting its shipping business and will be selling Hamburg Süd with all activities, subsidiaries and principal assets.

The world's seventh-biggest container operator, Hamburg Süd, has been sold to Danish conglomerate AP Moeller-Maersk. Maersk Line didn't disclose the purchase price of Hamburg Süd when it announced the takeover on Thursday, saying it hoped to complete the deal by the end of 2017.
According to WSJ, Maersk Line agreed to pay roughly $4 billion, according to people familiar with the discussions, making it one of the biggest deals for a container operator. The acquisition will boost Maersk's presence on North-South shipping routes.
Following intensive talks with several interested parties, an agreement has been signed with Maersk Line A/S, Copenhagen, Denmark, which is sub- ject to proper due diligence and the negotiation of a Sale and Purchase Agreement as well as the notification to various regulatory authorities. It is to be assumed that the transaction will be closed in late 2017 at the earli- est, once the necessary approvals have been obtained.
Hamburg Süd has performed well compared with its competitors. It has grown clearly in excess of the market and has financed the expansion of its network as well as the ship and container fleet largely from its own cash flow.
The owners and management of Hamburg Süd must, however, recognize that active participation in the consolidation process of the sector currently taking place would entail an even higher capital requirement. This would, in addition, make the balancing of risk within the Oetker Group business portfolio more cumbersome.
The owners of the Oetker Group have therefore decided to put Hamburg Süd in the hands of new owners. The global market leader Maersk is, in their view, the ideal partner to preserve and further develop the shipping company’s successful business model.
"The acquisition of Hamburg Süd is in line with our growth strategy and will increase the volumes of both Maersk Line and APM Terminals," Soren Skou, chief executive of Maersk Line and the Moeller-Maersk group said in a statement. The German shipping line and its Brazilian subsidiary Alianca were to continue as separate brands, he added.
With a carrying volume of around 4.1 million TEU (twenty-foot equivalent units) and a slot capacity of approximately 625,000 TEU Hamburg Süd ranks among the world’s ten largest container shipping companies. The tramp, product tanker and other operations make up some 7 percent of the total turnover. The shipping company has roughly 6,000 employees and, with revenues of around 6.1 billion euros, contributes just under 50 percent to the total sales of the Oetker Group (all figures refer to the 2015 financial year).
Hamburg Süd, which traces its roots back more than 100 years, previously explored a merger with German peer Hapag Lloyd, but talks collapsed in 2013 over pricing and who would run the merged entity.
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